Mergers & Acquisitions
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Diluted Shares Outstanding Excel Equation
I’m confused about an equation you used in the Merger Model Basics course. You calculated the “Number of Shares Equivalent” – the number of dilutive shares essentially – in the Walmart stores acquires Target accretion/dilution model using the equation =max(0,Number of Options*(1-Option Exe...
I’m confused about an equation you used in the Merger Model Basics course. You calculated the “Number of Shares Equivalent” – the number of dilutive shares essentially – in the Walmart stores acquires Target accretion/dilution model using the equation =max(0,Number of Options*(1-Option Exercise Price/Share Price)). I know we are using the Treasury Stock Method and I understand how the Treasury Stock Method works. I calculate the same value for the dilutive shares on paper as this equation does, but I just don’t understand how this equation works. I calculated the value of the equation to the right of the “0” and it seems to me that this value is always negative so I don’t understand how it is calculating the correct number and why it is not returning “0”.
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by Jonathan V.
added 10 years ago
